I recently had an issue with my D2 where when I would try to turn it on, I would get nothing. I then plugged it into my USB cable and attempted to power-on again, only to get the error message:
Verizon said that it was bad hardware. So, I thought my D2 had bricked on me. Nope. Got the replacement phone and it too displayed the exact same error message. Found a guy here at work that also has a Moto Droid (same battery)... borrowed his battery... and what do you know - my phone booted up.
The tech support folks at Verizon were very surprised that it was a battery issue, so I thought I'd post this to say - yes, it's possible (if you get that error message) that your battery has died an unexpected and sudden death.
My phone worked fine the entire day and into the night, and had a decent charge on it. The next morning, it was stone cold dead. Very weird.